Yesterday, several news outlets reported on what was claimed to be a leaked draft Executive Order that would, if signed by President Trump, suspend Dodd-Frank Section 1502 for a two year period by claiming it is in the US national security interest to eliminate US corporate due diligence activities concerning tin, tantalum, tungsten and gold (3TG). The document offers no explanation as to the reasoning behind the conclusion that national security interests are either currently threatened or how national security would improve by the action. Further, the Executive Order cites incorrect and outdated information about the costs of the Rule. In the end, none of that may matter as President Trump will almost certainly sign such an Order regardless.
Would that mean all conflict minerals traceability and reporting processes would immediately come to a halt?
First, there will continue to be customer demands for the information regardless of the SEC disclosure requirement, and you will have to meet your customer information requests or possibly jeopardize the business relationship. Second, the Order will very likely be challenged in court as was the President’s recent travel “ban” Executive Order. Once it goes to court, who knows what will happen and how fast or slow.
We recommend continuing to move forward on the due diligence and reporting activities already underway for calendar year 2016. But stay tuned – the situation is changing more rapidly and drastically than anyone had imagined.